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I agree with different people run business differently.
Your examples of porridge or key cutting, do you think the prices were the same 10 years ago? Occasional discount is not comparing apple with apple. The nearest similarity I can think of is when every couple of months or maybe twice a year I take my tenants out for a chat/meeting to catch up, could be just a Costa coffee or sometimes it's a dinner on me. That is my way like supermarket occasionally giving you a discount, to maintain customers relation / interest.
Rarely come across someone leaving and the reason quoted was the rent increase of £20. I only have very few HB tenants therefore maybe my perspective or clientele is very different from yours.
With government turning on the pressure with wear and tear allowance, S24, difficult financing, no estate agent fee etc... I think we have to start to change our rather relax attitude towards this business.
When my banking friend asked me the other day as to why property prices keep going up 6 to 8% per year, rent can stay relatively stagnant (very small increases relatively), how do we landlords manage that is really beyond most people in other business. I have no good answer other than to say, some landlords may feel that the profit margin is too good to care £20 extra per month (or £240 per year). But DL, you got me thinking, what if a landlord has 50 properties, that would be losing £12,000 in the first year, £24,000 in the second year and £36,000 I the 3rd year. That is only a simplistic calculation because I did not include the power of compound interest with the increases.
DL, I think we just have to agree that we disagree with each other's way of running a business. Like you said, there is not right or wrong, it's in the eye of the beholder.
Sorry DL (if you are reading this), keep referring to the wrong person. The messages are obviously for JC.
These are more the private tenants rather than the HB ones
HB do not have access to such freedom of movement so I agree unlikely to move on
Until the LHA freeze the rents went up automatically every April
The tenants never even knew as they all went direct to me
I just got a wad of forms through notifying me of the increased payout
There are continual and multiple discounts every time I shop so every month I would easily save £20
And I dont even go in for these extra discounts with vouchers and loyalty cards etc
I tell a lie . I have a Nectar card but have no idea how to cash in the points i guess are on there
The supermarkets all vie for my shopping budget
The logic is the same with 1 property or 50
If house values go up 5% on 50 x 100K units that is a 250K gain
If your average net cash flow is 300 pcm thats 180K income pa
250K + 180K = 430K. Losing 12K out of 430K aint that bad in the bigger scheme of things
Year 2 and 3 you would maybe be more likely to adjust as you `let them off ` Year 1
Paperwork wise it easier to do a £40 rise every 2 years if you were going to raise
And as I indicated if they all move on that`s a potential 90K loss rather than a 12K loss
So its all relative .
You intimate people have a relaxed attitude which has to change
All the LL`s I talk to are perfectly switched on and focused on their business
I agree we will have to agree to disagree though
You say stick rent up 3% a year come what may but buy them the odd costa to keep them sweet
I say look be flexible and look at each case individually and mix and match your response
Some I dont touch but I dont fork out 240 on a new carpet and I dont want to risk them leaving
Some I raise 3% like you
Some I raise 6% if lagging behind
Some I raise 10% maybe because I want them to move on and do a refurb
You go for a blanket coverage approach . I go for a more bespoke approach
Jonathan Clarke. http://www.buytoletmk.com
And yes best of luck to V&N this week with your meeting
You are great spokespeople and are dynamic positive representatives for 1000`s of LL`s
Your invite also demonstrates that PT is mainstream reading for them
It ensures our collective voice is heard
I echo Cash Genie`s comments
I ask the government...............
Rescind the retrospective nature of S24 and I can live with it going forward
Its a tax on me yes but that has a far greater negative effect ultimately on my tenants
I`m not going down and I can comfortably survive
But to save me - unfortunately and regrettably some of my tenants have to take the bullet for me
If you make it non retrospective they will still have a home
Why is there no consistency in reports of what rent levels and property prices are doing.